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UPDATE 2-Indonesia fears piracy surge on busy shipping route could lead to 'new Somalia'

Published 2016-04-21, 07:24 a/m
© Reuters.  UPDATE 2-Indonesia fears piracy surge on busy shipping route could lead to 'new Somalia'

* Indonesia, Malaysia, Philippines ministers to meet in
Jakarta
* Up to 18 Indonesians, Malaysians held captive in
Philippines
* Some Indonesian ports halt coal shipments to Philippines

(Adds comments on Philippine coal importers, Indonesian
exporters)
By Fergus Jensen and Kanupriya Kapoor
JAKARTA, April 21 (Reuters) - Indonesia fears piracy on a
busy shipping route along its maritime border with the
Philippines could hit levels seen in Somalia unless security is
tightened, its chief security minister said on Thursday,
following a spate of kidnappings.
The route lies on major shipping arteries that analysts say
carry $40 billion worth of cargo each year. It is taken by fully
laden supertankers from the Indian Ocean that cannot use the
crowded Malacca Strait.
For the first time, concerns over rising maritime attacks by
suspected Islamist militants are disrupting coal trade between
the Southeast Asian neighbours, with two Indonesian coal ports
suspending shipments to the Philippines.
Up to 18 Indonesians and Malaysians have been taken captive
in three attacks on tugboats in Philippine waters along the
route by groups suspected of ties to the al-Qaeda linked Abu
Sayyaf militant network.
Abu Sayyaf, a small but violent group which has posted
videos on social media pledging allegiance to Islamic State
militants in Iraq and Syria, has demanded 50 million pesos ($1.1
million) to free the Indonesian crew.
"We don't want to see this become a new Somalia," Indonesian
chief security minister Luhut Pandjaitan told reporters,
referring to the southern Philippine waters of the Sulu Sea,
where the abductions took place.
Piracy near Somalia's coast has subsided in the last few
years, mainly due to shipping firms hiring private security
details and the presence of international warships.
The foreign ministers of Indonesia, Malaysia and the
Philippines would meet in Jakarta to discuss the possibility of
joint patrols, Pandjaitan said.
He did not give a date, but said the armed forces chiefs of
the three countries would meet in Jakarta on May 3.
Authorities at two Indonesian coal ports had blocked
departures of ships for the Philippines and more suspensions
were expected, said Pandu Sjahrir, chairman of the Indonesian
Coal Mining Association, and a director of Jakarta-listed coal
producer Toba Bara Sejahtera TOBA.JK .
Toba had suspended all shipments to the Philippines, Sjahrir
said. Other companies had cancelled shipments "from both sides",
he added.
Indonesian state-owned coal miner Bukit Asam PTBA.JK said
it was diverting Philippine coal shipments to Hong Kong for the
next three months. The company ships less than 1 million tonnes
to the Philippines per year, Bukit Asam corporate secretary Joko
Pramono told Reuters.
A company with a fleet of 40 dry cargo ships saw a silver
lining, however.
"If Indonesia bans tugs and barges from exporting coal then
it will have to travel in larger cargo ships, of 32,000 to
64,000 tonnes," said Khalid Hashim, managing director of
Bangkok-listed Precious Shipping. PSL.BK
"All this would of course be beneficial for shippers like
us."
Indonesia, the world's largest thermal coal exporter,
supplies 70 percent of the Philippines' coal import needs, which
Indonesian data shows stood at about 15 million tonnes, worth
around $800 million, last year.
Philippine coal importers, however, said they could can
import coal from other countries including Australia, South
Africa and Russia and source more locally if Indonesian
shipments dry up.
Eikon interactive map of bulk vessel trade flows from Indonesia:
reuters://REALTIME/verb=Interactive%20Map/context=%3CNavigation%3E%3CEntities%3E%3CEntity%3E%3CInteractiveMap%20version=%221%22%3E%3CMap%3E%3CMapTargetZoom%3E5%3C/MapTargetZoom%3E%3CMapTargetCenter%20X=%22114.77416992%22%20Y=%225.82368665%22%20/%3E%3CMapMode%3E2%3C/MapMode%3E%3CWrapAround%3ETrue%3C/WrapAround%3E%3CLayers%3E%3CLayer%20Type=%22UserList%22%3E%3CIdentifiers%20/%3E%3C/Layer%3E%3CLayer%20Type=%22PortAnalyzer%22%3E%3COriginZones%3E%3CRCSCode%3EG:25%3C/RCSCode%3E%3C/OriginZones%3E%3C/Layer%3E%3CLayer%20Type=%22BulkerVessels%22%3E%3CConfiguration%3E%3CVesselTypeRoot%3E%3CItem%20RCS=%22F:2I%22%3E%3CItem%20RCS=%22F:2S%22%20Selected=%22False%22%20/%3E%3CItem%20RCS=%22F:2T%22%20Selected=%22False%22%20/%3E%3C/Item%3E%3C/VesselTypeRoot%3E%3C/Configuration%3E%3C/Layer%3E%3C/Layers%3E%3C/Map%3E%3C/InteractiveMap%3E%3C/Entity%3E%3C/Entities%3E%3C/Navigation%3E
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